Madras High Court
Nivaram Pharma Pvt. Ltd. Rep. By Its ... vs The Customs, Excise And Gold (Control) ... on 2 March, 2005
Equivalent citations: (2005)2MLJ246
Author: Markandey Katju
Bench: Markandey Katju, D. Murugesan
JUDGMENT Markandey Katju, C.J.
1. This writ appeal has been filed against the impugned order of the learned single Judge dated 15.10.2004.
2. Heard the learned counsel for the parties and perused the record.
3. The writ petition had been filed before the learned single Judge against the order of the CEGAT dated 09.07.1997.
4. We are surprised that this writ petition was entertained at all. There was a clear alternative remedy against the order of the CEGAT dated 09.07.1997 by means of filing a Reference Application before the CEGAT under Section 35G(1) of the Central Excise Act (hereinafter referred to as the 'Act') and if that application was rejected by the CEGAT there was a second alternative remedy of approaching this Court under Section 35G(3) of the Act seeking a direction to the CEGAT to make a reference to this Court.
5. It is well settled by a series of decisions of the Supreme Court that particularly in tax matters there should be no short circuiting of the statutory remedies, vide Titaghur Paper Mills Co. Ltd. v. State of Orissa, , Assistant Collector of Central Excise, Chandan Nagar v. Dunlop India Limited, , etc.
6. It is well settled that when there is an alternative remedy ordinarily writ jurisdiction of this Court under Article 226 of the constitution should not be invoked. This principle applies with greater force regarding tax proceedings. As observed by the Supreme Court in Titaghur Paper Mills Co. Ltd. v. State of Orissa, :
"Where a right or liability is created by a statute which gives a special remedy for enforcing it, the remedy provided by that statute only must be availed of.
7. A Constitution Bench of the Supreme Court in G. Veerappa Pillai v. Raman and Raman Ltd., held that as the Motor Vehicles Act is a self contained code and itself provides for a forum for appeal/revision, the writ jurisdiction should not be invoked in matters relating to its provisions. A similar view was taken in Assistant Collector of Central Excise Chandan Nagar v. Dunlop India Limited, .
8. In Assistant Collector of Central Excise, Chandan Nagar v. Dunlop India Limited (Supra) the Supreme Court observed:
"In Titaghur Paper Mills Co. Ltd. v. State of Orissa, A.P. Sen, E.S. Venkataramiah and R.B. Misra, JJ. held that where the statute itself provided the petitioners with an efficacious alternative remedy by way of an appeal to the Prescribed Authority, a second appeal to the Tribunal and thereafter to have the case stated to the High Court, it was not for the High Court to exercise its extraordinary jurisdiction under Article 226 of the Constitution ignoring as it were, the complete statutory machinery. That it has become necessary, even now, for us to repeat this admonition is indeed a matter of tragic concern to us. Article 226 is not meant to short circuit or circumvent statutory procedures. It is only where statutory remedies are entirely ill suited to meet the demands of extraordinary situations, as for instance where the very vires of the statute is in question or where private or public wrongs are so inextricably mixed up and the prevention of public injury and the vindication of public justice require it that recourse may be had to Art. 226 of the Constitution. But, then the Court must have good and sufficient reason to by pass the alternative remedy provided by statute. Surely, matters involving the revenue where statutory remedies are available are not such matters. We can also take judicial notice of the fact that the vast majority of the petitions under Art.226 of the Constitution are filed solely for the purpose of obtaining interim orders and thereafter prolong the proceedings by one device or the other. The practice certainly needs to be strongly discouraged."
9. In C.A. Ibraham v. ITO, , H.B. Gandhi v. Gopinath & Sons, 1992 (Suppl) 2 SCC 312 and in Karnatak Chemical Industries v. Union of India, the Supreme Court held that where there is a hierarchy of appeals provided by the statute the party must exhaust the statutory remedies before resorting to writ jurisdiction. All these decisions are related to taxing statutes, and are hence apposite to the present context.
10. In Sheela Devi v. Jaspal Singh, and Punjab National Bank v. D.C. Krishna, the Supreme Court held that if the statute provides for remedy of revision or appeal, writ jurisdiction should not be invoked.
11. In Union of India v. T.R. Verma, the Supreme Court held that it is well settled that when an alternative and equally efficacious remedy is open to a litigant, he should be required to pursue that remedy and not invoke the special jurisdiction of the High Court to issue a prerogative writ. It will be a sound exercise of discretion to refuse to interfere in a petition under Article 226 of the Constitution unless there are good grounds to do otherwise.
12. In A. Venkatasubbiah Naidu v. S. Chellappan, the Supreme Court deprecated the practice of exercising the writ jurisdiction when an efficacious alternative remedy is available.
13. In W.P. No. 981 of 2003 (Tax) (Khandelwal Soya Industries Ltd. v. State of U.P. and Ors.) decided on 27.08.2003 a Division Bench of the Allahabad High Court dismissed a writ petition challenging the provisional assessment orders under the U.P. Trade Tax Act on the ground of alternative remedy under Section 9 of that Act. Against the aforesaid judgment, Special Leave Petition was filed before the Supreme Court which has been dismissed. We respectfully agree with the view taken by the Allahabad High Court in the aforesaid decision.
14. We are therefore surprised that the writ petition was entertained at all by this Court.
15. There are well settled principles of writ jurisdiction and Judges also must exercise self-discipline. It has been repeatedly held by the Supreme Court that in tax matters there should be no short circuiting the statutory remedies of appeal, revision, etc. We are therefore surprised that in this case the learned single Judge did not observe this well settled principle of self-discipline and entertained the writ petition despite existence of statutory remedies.
16. The learned single Judge no doubt dismissed the writ petition on merits but in our opinion he should not have gone into the merits at all and he should have dismissed the writ petition straightaway on the ground of alternative remedy. Hence, this writ appeal as well as the writ petition are dismissed on the ground of alternative remedy under the Central Excise Act. Consequently, W.A.M.P. No. 669 of 2005 for stay is also dismissed. However, we make it clear that the observations made by the learned single Judge will not influence the statutory authorities if the assessee/appellant chooses to exercise its alternative remedies under the Act.